If you’ve followed me on LinkedIn, you’ve probably seen me mention this before—but it’s worth repeating. Ownership changes can trigger serious reporting obligations with the Alcohol and Tobacco Tax and Trade Bureau (TTB), and missing a deadline here can cause real headaches.
What Should Be Done
For anyone listed on your federal permit—typically individuals with signature authority or at least a 10% ownership stake—any change to that person’s status should be reported to TTB within 30 days. This includes someone leaving the company, selling their interest, or stepping out of a qualifying role.
What Absolutely Must Be Done
If the change results in a “change of control,” reporting isn’t optional—it’s critical. Generally, TTB considers a change of control to occur when more than 50% of the ownership interests in the company change hands (but there are other circumstances too – like the departure of a CEO or President, regardless of their ownership stake).
A change of control must be reported to TTB within 30 days of the change. No exceptions.
What Happens If You Miss the Deadline?
Unfortunately, nothing good.
Federal regulations are clear: if a change of control isn’t reported on time, your permit automatically terminates as of the date of the change. From that point forward, any production is considered unlawful.
That can trigger the highest excise tax rates along with penalties and interest—because most businesses keep filing at their usual (lower) rates, not realizing they’re no longer eligible.
Does This Happen Often?
More often than you’d think.
Before 2018, TTB wasn’t particularly aggressive about enforcing the 30-day rule. But that’s changed. Enforcement is much tighter now, and missing the deadline can put your entire operation at risk.
Bottom Line: Don’t Miss the Deadline.
Reporting changes promptly protects your business and keeps your permit in good standing. If you’re ever unsure whether a change triggers reporting—or you just want help navigating the process—reach out, preferably before any agreements evidencing a change are signed.
Thanks for reading!